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Irish households have never been better off and now have a combined €4bn more of savings than they owe in debts.

The total amount of loans owned by households has fallen by €60bn since the start of the crash, thanks to debt repayments, write-offs and to the slowdown in the new mortgage market, according to a review of the economy published today by employers’ group Ibec.

While many families that want to borrow to buy a home are struggling to get a mortgage, it means the average level of indebtedness has fallen sharply.

The overall value of household assets – mainly homes and property – was higher during the boom, but that was cancelled out by the debt levels, according to the report, while household savings are €16.5bn higher than in 2007.

“As a result the net wealth position of Irish households in nominal terms has never been better,” the report said.

The spread of wealth is not even, but the shift from mass negative equity to more broad-based household solvency is likely to affect the wider economy, including boosting confidence among consumers.

Ibec researchers think disposable income is now likely to have exceeded boom levels.

The figures are included in a wider Quarterly Economic Outlook for the Irish economy, which forecasts growth of 4.2pc in 2018 following expected growth of almost 6pc last year.

Ibec’s growth forecasts have been notably more optimistic than many other commentators over the past five years, but have largely been borne out.

“Since the crisis we have seen a recovery in the Irish economy which has been exceptional. This was driven by the strength of the Irish business model with record FDI and an increasingly global footprint from our indigenous industries,” said Ibec’s head of tax and fiscal policy Gerard Brady.

The “economic recovery phase is now over” he said, suggesting that the economy has largely caught up to the trajectory that was distorted by the boom and bust. The report appears to contradict claims that the recovery has been skewed towards the better off, saying wages have been the key driver of household recovery.

New jobs, wage growth for those already in work and low inflation here mean that Irish workers are on course to have experienced the strongest real earnings growth in the EU during 2017.

It’s a stark contrast to the UK in particular, where stagnant wages and the fall in the value of the pound has left families less well off over the past 18 months.

“Our most recent HR update survey indicates average pay grew by 2.2pc in 2017. As a result, Irish average real (inflation adjusted) earnings are now experiencing the strongest growth of any country in Western Europe at 1.8pc,” Ibec said.

Real income growth here is four times the EU average. Income declined in eight of the 15 most developed member states.

Here, new jobs and the return of wage growth mean ordinary households are seeing the greatest gains from the recovery, in proportional terms, Ibec said.

“The greatest gains from increased incomes have accrued to the bottom deciles (those on lower incomes) in proportional terms. Overall the impact of improving employment and wages is clear… with 80pc of the net improvement in average household income in the State since 2013 coming from increased employee income.”